International Scenario

Global pharmaceutical industry is robust and steadily growing. The industry consists of large, medium and numerous small-scale units providing huge employment opportunities and producing large quantities of life saving and others drug.  This market has provided growing opportunities for Indian pharmaceuticals industry too. The global pharmaceutical markets were estimated at US$712 billion in the year 2007 growing at 6.4 percent. The market size of USA is estimated at US$295-305bn (growing at 4-5 percent) followed by top five European countries (EU-5) with an estimated market size of US$135-145bn (growing at 4-5%), Emerging markets, viz., Brazil, China, India, Mexico, Russia, South Korea & Turkey had an estimated market size of US$85-90bn. (growing at 12-13%) and Japan with an estimated market size of US$64-68bn (growing at 1-2%). Hence targeting emerging markets as export destination provide easier and better opportunities.

World market for patent expired molecules ( pure generics and branded generics) i valued at US$ 102 billion in 2006  and is expected to grow to  US$ 160 billion by 2010.Market size for pure generics is estimate at  US$ 65 billion ( with growth 11% in 2008). World trade in APIs (bulk drug) and their intermediates is expected at US$ 70 billion. Global market for Contract Research and Manufacturing Services (CRAMS) is estimated at US$ 48 billion. It is expected to grow at a CAGR of 10%.

National Scenario

The pharmaceutical industry in India has made phenomenal progress in the last 10 years. The pharmaceutical industry comprises of formulation and bulk drugs (API) manufacturing units. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. Thus the national industry is playing a significant role in improving the health standards of the people.

Bulk drug industry is the backbone of the self-reliant Pharmaceuticals  industry in India. Today 90% of the domestic bulk drugs requirement is met by the Indian industry itself. A highly organized sector, the Indian Pharmaceutical industry is estimated to be worth U$10.76 billion (2008), growing at about 8 to 9 percent annually. Around one-third of this estimated to be exported.

The pharmaceutical industry in India meets around 70% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, oral and injectibles. There are about 250 large units and around 8000 SMEs, which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units)..

Impact of product patent

IIn 2004 India shifted for process to product patent under the product patent regime, Indian companies cannot manufacture and market products under patent. Companies interested in the products have to get license from the innovator company( patent holder). Majority share of the profits will go to the patent holder. Thus Indian companies will not be able to produce or export new drugs.